APPEASEMENT

Te Awamutu Courier, Volume 63, Issue 4464, 15 August 1941, Page 7

APPEASEMENT

IN THE PACIFIC. ALLIES NEED SHIPS TAKING OIL TO JAPAN. (Published in “PM”) NEW YORK, May 21. Japan desperately needs oil. America and Britain desperately need ships. Yet United States and British oil company subsidiaries, using ships owned by American and British-con-trolled firms, are carrying oil from the Dutch East Indies to Japan under a trade deal that has just been renewed. That is appeasement in the Pacific. Business as usual! The authority is the Standard Oil Company of New Jersey, which co-operates in the deal with the Socony-Vacuum Company of New York and the British-controlled Royal Dutch-Shell companies. Northrup Clarey wrote this explanation to a stockholder who had asked Walter C. Teagle, chairman of the board about the deal: “Without any express order to that effect, our Government has indicated its desire that we continue the shipments to Japan, these consisting largely of oil from a partly-owned subsidiary in the Dutch East Indies. To have cut off such exports might have forced, the Japanese to take aggressive steps to get oil elsewhere, and this would likely have precipitated trouble with the United States of America. A citizen or a corporation has no right to usurp the functions of government authorities by creating conditions of an embargo. VITAL TO JAPAN. The threat that Japan would take the oil by force apparently did not have much effect on another Standard Oil official, as recently as February of this year. Eugene Holman, a director, spoke before the American Institute of Mining and Metallurgical Engineers. This paragraph is from the “New York Times’s” report of that talk: “In case Japan became actively belligerent,” Mr Holman said, “it would be almost completely cut off from any source of petroleum, since California is Japan’s chief supply source. It was doubtful whether Japan could organise sufficiently strong convoys to move oil from the Dutch East Indies, even assuming that supplies could be obtained there.” The Dutch East Indies’ source is not relatively large, but it is of tremendous importance to Japan. Japan produces only about 11 per cent, of her own petroleum, and about half of her annual consumption in war time comes from the United States. In short, an American and British oil embargo on Japan would cut her supply so much that she couldn’t wage war long. She does not have the tankers to go after her own oil. At the same time an embargo would relieve Britain’s Middle East oil shortage, and the shipping shortage of both Britain and the United States.

The Dutch East Indies oil deal was made last November. It tripled the usual export of oil from the Indies to Japan. The figures: 494,000 tons to 1,800,000 tons. Japan failed to take the full quota, and the news dispatches said “jt is believed a tanker shortage was the reason.” This is the agreement that was renewed just this month for another six months. The original deal was completed after the fall of France. It is understood that the British and Ame-rican-controlled firms made the deal on a 75-25 basis. Royal Dutch-Shell companies participating are about 4£ per cent. British. Hollanders who dominate the company arc British allies. There are other American corporations selling petroleum products directly or indirectly to Axis Powers, or selling to neutrals where transhipment is probable, or which are chartering their tankers to shippers who are making such deliveries. Among major oil companies so engaged, either directly or through affiliates, are: The Texas Corporation. The Gulf Oil Company. Standard Oil Company of California. Standard Oil Company of New Jersey. Socony-Vacuum Oil Company. Tidewater Associated Oil Company. Union Oil Company of California. Shell Union Oil Corporation (a Royal Dutch-Shell interest). Those arc the major corporations. Maritime Commission reports list charters of ships by other firms—such as Cities Service—to foreign corporations shipping to Portugal, Spain, or Russia. Richfield of California, Consolidated, and Phillips, among the major producers and distributors, have not answered telegrams from “PM” asking for information on their shipments, if any, to Axis Powers. Exact information on shipments in public records is protected as confidential. Information on licensed ship-

ments is on record in the Department of State, in the customs offices where manifests are recorded, and in the Maritime Commission if the vessels chartered are under control of the commission. THE SHIPPING POOL. Foreign diplomatic and consular agents are loath to discuss exports of national defence materials because of foreign affairs complications. This applies even to the Chinese, who have most to gain by any action cutting down exports to Japan. Meanwhile the Maritime Commission is doing its utmost to get cargo bottoms. It is organising a pool of 2,000,000 tons to handle traffic that will help Britain and help the United States deliver the goods. In April it placed orders for 208 vessels, including 72 tankers. On May 1, American shipyards had orders for 800 ships totalling 5,096,530 tons. Seven oceangoing vessels of 58,500 tons were completed in April, and eight of 66,100 tons were launched. The commission listed more than 1,600,000 tons of shipping—steam and motor vessels of more than 1000 tons —as owned by American companies, but operating under foreign flags. This included more than 600,000 tons under British registry. These ships, because of foreign registry, are free to enter war zones. American ships are forbidden to enter such waters. Much of x this shipping is transporting for the British or the United States. Many are owned by foreign subsidiaries of American companies. Their exact activity may not be known.